How can I take these two meshes and properly mold them together proportionately like the reciever of a gun?
Now that I understand your goal, and I tested it, I think I found what you want.
Start with a cube scaled the way you need to have the top face be your rect. Then add a low poly cylinder on top. It's key to make sure that the cylinder is more than halfway submerged in the stretched cube, as this will create a better transition later on.

Add the boolean modifier to that cube, then select the cylinder as the object and set the operation to union. I found that it is necessary to apply this modifier after this.

After deleting or hiding the original cylinder, you might find there is an error with the polygons that make up the remaining rectangle. I found that on one side, the corner vertices were not properly connected, resulting in a u-shaped ngon. I fixed it by deleting that face, and selecting the edges I wanted, then pressing the F key to bridge them.

Add the subdivision modifier, and you get something I'm sure was not your intended shape. If it looks like this, you can rest assured we can control this.
Go into edit mode, and click button on the subdivision modifier to show the results in edit mode. 
Select the edges of the top face of the box, and the vertical edges (Like a stick figure table). With all those edges selected, press Shift-E, and then pull the mouse away from it's starting point until the edges turn fully red. The result should look like this.
Creases won't help with the ends though. Creases are a less expensive way of controlling the smoothness, but the ends will require a more old-fashioned approach, known as control loops. While still in edit mode, create a loop with Ctrl-R. Click once while it is the center, then  you can drag the loop around, so drag it close to the end to tighten up the transition and click again.

I hope this is the actual result you were looking for, but if not, it was fun practice on better stack answering.